TOSCANA ANNOUNCES ACQUISITION AND INTERNALIZATION OF PERFORMANCE FEE

Toscana Energy Income Corporation (“Toscana” or the “Corporation“) (TSX:TEI) has entered into Purchase and Sale Agreements to acquire approximately 200 BOEs/d of long life oil and gas assets (approximately 80% light oil) (the “Assets“).

The Assets being purchased fall within the Corporation’s core operating areas of southern and central Alberta. The aggregate purchase price for the Assets is approximately $9 million. The Corporation’s existing credit facilities will be used to finance the acquisition, and completion of the acquisition will be subject to normal industry closing conditions.

Other key attributes of the Assets being acquired include, but are not limited to, the following:

significant oil in place;

proved plus probable acquisition cost of $20.18/BOE based on an independent engineering report prepared in accordance with National Instrument 51-101 and effective December 31, 2014 (the “Report“) which includes future development costs over the reserve base;

$45,250 per flowing barrel (80% light oil); and

run rate acquisition costs of 4.5 times.

The acquisition of the Assets has an effective date of January 1, 2015. It is expected that the Assets will increase corporate production to approximately 2,500 BOEs/d.

Internalization of Performance Fee

Background

Toscana Energy Corporation (“TEC“) is a wholly-owned subsidiary of Sprott Inc. TEC is the manager of Toscana pursuant to a management agreement dated October 10, 2012 between Toscana and TEC (the “Management Agreement“). In accordance with the terms of the Management Agreement, Toscana pays an amount calculated on a monthly basis equal to 2% of the total revenue from assets owned or controlled by the Corporation now and in the future (“Performance Fee“).

Internalization

Toscana entered into an agreement with TEC to internalize the Performance Fee (the “Transaction“), in exchange for a one-time cash payment of $4.75 million (plus GST) from the Corporation to TEC. This amount will be adjusted in an amount equal to the amount of Performance Fee paid from January 1, 2015 up to and including the closing date of the Transaction. The Transaction will also contain mutually agreed upon amendments to the Management Agreement to reflect the internalization and termination of the Performance Fee.

The Transaction was approved by Toscana’s independent directors.

Benefit to Toscana

Toscana’s management expects the Transaction to reduce Toscana’s general and administrative expenses (“G&A“) by approximately $0.65/boe (17% of G&A), based on current production and commodity prices. In addition, Toscana will enjoy additional savings as the Corporation’s production and reserve base continues to grow.

BOE Equivalency

Barrel of oil equivalents or BOEs may be misleading, particularly if used in isolation. A BOE conversion ratio of 6 Mcf: 1 bbl is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead. Given the value ratio based on the current price of crude oil as compared to natural gas is significantly different from the energy equivalency of 6 Mcf: 1 bbl, utilizing a conversion ratio of 6 Mcf: 1 bbl may be a misleading indication of value.

Forward-Looking Statements:

This news release contains forward‐looking statements and forward‐looking information within the meaning of applicable securities laws. These statements relate to future events or future performance. All statements other than statements of historical fact may be forward‐looking statements or information. Forward‐looking statements and information are often, but not always, identified by the use of words such as “appear”, “seek”, “anticipate”, “plan”, “continue”, “estimate”, “approximate”, “expect”, “may”, “will”, “project”, “predict”, “potential”, “targeting”, “intend”, “could”, “might”, “should”, “believe”, “would” and similar expressions.

More particularly and without limitation, this news release contains forward‐looking statements and information concerning the Corporation’s petroleum and natural gas production and reserves with respect to the Assets to be acquired; and amendments to the Management Agreement in connection with the Transaction. The forward‐looking statements and information are based on certain key expectations and assumptions made by management of the Corporation, including expectations and assumptions concerning well production rates and reserve volumes in respect of the assets to be acquired; project development and overall business strategy. Although management of the Corporation believes that the expectations and assumptions on which such forward looking statements and information are based are reasonable, undue reliance should not be placed on the forward‐looking statements and information since no assurance can be given that they will prove to be correct.

Forward-looking statements and information are provided for the purpose of providing information about the current expectations and plans of management of the Corporation relating to the future. Readers are cautioned that reliance on such statements and information may not be appropriate for other purposes, such as making investment decisions. Since forward‐looking statements and information address future events and conditions, by their very nature they involve inherent risks and uncertainties. Actual results could differ materially from those currently anticipated due to a number of factors and risks. These include, but are not limited to, the risks associated with the oil and gas industry in general such as operational risks in development, exploration and production delays or changes in plans with respect to exploration or development projects or capital expenditures; the uncertainty of reserve estimates; the uncertainty of estimates and projections relating to reserves, production, costs and expenses; health, safety and environmental risks; commodity price and exchange rate fluctuations; marketing and transportation; loss of markets; environmental risks; competition; incorrect assessment of the value of acquisitions and failure to realize the anticipated benefits of acquisitions; ability to access sufficient capital from internal and external sources; failure to obtain required regulatory and other approvals and changes in legislation, including but not limited to tax laws, royalties and environmental regulations. Accordingly, readers should not place undue reliance on the forward‐looking statements, timelines and information contained in this news release. Readers are cautioned that the foregoing list of factors is not exhaustive.

The forward‐looking statements and information contained in this news release are made as of the date hereof and no undertaking is given to update publicly or revise any forward‐looking statements or information, whether as a result of new information, future events or otherwise, unless so required by applicable securities laws or the Toronto Stock Exchange (“TSX”). The forward-looking statements or information contained in this news release are expressly qualified by this cautionary statement.

About Toscana Energy Income Corporation

Toscana is a conventional oil and gas producer with the mandate to acquire high quality, long life oil and gas assets including royalties, non-operated working interests and unitized production for yield and capital appreciation. Toscana is managed by Sprott Toscana through TEC. Sprott Toscana is a member of the Sprott Group of Companies.

Neither the TSX nor its Regulation Services Provider (as that term is defined in the policies of the TSX) accepts responsibility for the adequacy or accuracy of this release.